TaxTMI 
TaxTMI 
1993 (10) TMI 107
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....d the lapse and offered the share income from M/s. United Jari Industries and remuneration derived from M/s. Laxmi Oil Extraction Pvt. Ltd. for assessment. 3. During the course of assessment proceedings, the learned ITO in addition to the above two amounts offered by the assessee added a further sum of Rs. 11,380 on account of low withdrawals for household expenses. The ITO initiated penalty proceedings under section 271(1)(c). In response to the show-cause notice, it was submitted before the ITO that the share income from M/s. United Jari Industries and remuneration from M/s. Laxmi Oil Extraction Pvt. Ltd. had not shown in the return through inadvertence and that the addition on account of low withdrawals for household expenses was based on estimate and hence no penalty was leviable. Rejecting the contentions the learned ITO levied the impugned penalty. 4. On appeal, the CIT (Appeals) confirmed the action of the learned ITO observing inter alia as under: "From the facts narrated above, it is clear that the assessee failed to disclose his income from partnership share profits, although it was a fact that he was an active partner. Similarly, the assessee failed to disclose ....
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....tified. The learned counsel further submitted that no penalty was leviable in respect of the addition of Rs. 11,380 on account of low withdrawals for household expenses as the same was made on estimate basis. In support of his contention, the learned counsel relied upon D.V. Patel & Co. v. CIT [1975] 100 ITR 524 (Guj.), CIT v. K. Mahim [1984] 149 ITR 737 (Ker.), CIT v. S.P. Bhatt [1974] 97 ITR 440 (Guj.), CIT v. Vinaychand Harilal [1979] 120 ITR 752 (Guj.), K.M. Bhatia v. CIT [1992] 193 ITR 379 (Guj.), Sreelekha Banerjee v. CIT [1963] 49 ITR 112 (SC), CWT v. Ramniklal D. Mehta [1982] 136 ITR 729 (Ori.) and Chhotalal Vashram v. ITO [1984] 19 TTJ (Ahd.) 287. 6. Shri S.K. Tyagi, the learned Sr. D.R. submitted that there was a deliberate attempt on the part of the assessee to conceal the income by not declaring the share income from M/s. United Jari Industries and remuneration from M/s. Laxmi Oil Extraction Pvt. Ltd. He further submitted that the lapse of not declaring the above income was brought to the notice of the assessee by the ITO as per letter dated 1-3-1978 and the assessee offered the aforesaid income for assessment only after detection. The learned Sr. D. R. further submi....
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....sp; Rs. 19,378 3. Fees/salary from M/s. Laxmi Oil Extraction Mills (P.) Ltd. Rs. 18,000 4. Fees/salary from M/s. Motiram Roopchand Rs. 9,900 &n....
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....nbsp; Rs. 83,904 ------------------- The return in respect of all the sources mentioned above already have appeared to be submitted at Surat. It will take sometime to getting the return signed and completed. We have no objection if the assessment is framed on the figures mentioned above." From the contents of the above letter it is evident that the assessee was not sure whether he filed a revised return at Surat. It is not understood that when the assessee was regularly being assessed at Jaipur what necessita....
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.... relevant provisions and laid down the guiding principles in Arunachalam Chettyar v. CIT [1931] 6 ITC 58 (Mad.). An assessee who made a bona fide discovery about having made a previous incorrect return was entitled to make a revised return invoking the enabling provisions of section 22(3) of the 1922 Act. Such a course, however, is not open when a previous return was dishonestly made. The Full Bench had no hesitation to reject outright a contention, though "seriously argued", that an assessee is enabled to put in return correcting a former inaccurate one notwithstanding the fact that the previous return was a deliberately dishonest one. Such an exercise could not absolve him from liability to penalty. A different conclusion according to the Court, was "to put a premium on dishonesty". The same principle has been applied by the Madras High Court in subsequent judgment in CIT v. J.K.A. Subramania Chettiar [1977] 110 ITR 602. The decisions considered by the Court in the aforesaid judgment include Ayyasami Nadar & Bros. v. CIT [1956] 30 ITR 565 (Mad.), Vadilal Ichhachand v. CIT [1957] 32 ITR 569 (Bom.), Dayabhai Girdharbhai v. CIT [1957] 32 ITR 677 (Bom.), Sivagaminatha Moopanar & S v.....